China Mobile launches own-brand smartphones

August 5, 2013 Leave a comment

China Mobile launches own-brand smartphones

English.news.cn   2013-08-03

By Shen Jingting

BEIJING, Aug. 3 (Xinhuanet) — China Mobile Ltd officially entered the booming mobile terminal market on Friday as it unveiled its own-brand smartphone models. The China Mobile M701, a 5-inch screen Android-based smartphone equipped with MediaTek Inc’s 1.2-gigahertz quad-core processor, is priced at 1,299 yuan ($212). The China Mobile M601 is a 4-inch screen, dual-core Android smartphone that targets lower-end users with a price of 499 yuan. The two smartphones are produced by original equipment manufacturers, Hisense Group and Shenzhen-based BYD Co Ltd, respectively. They will hit the Chinese market through China Mobile’s online and offline outlets this month.Li Yue, chief executive officer of China Mobile, the world’s biggest telecom operator by subscribers, said the company has about 740 million customers.

Li said those customers usually change their mobile phones every 23 months, so at least 300 million new mobile devices are needed every year.

“China’s mobile terminal industry has a very bright future,” Li said, during a Beijing news briefing on Friday.

Analysts pointed out some additional implications for China Mobile’s smartphone launch.

James Yan, an analyst with research firm IDC China, said China Mobile’s move aims to create a platform that seamlessly integrates its current mobile services, such as the instant messaging tool Fetion, and other mobile applications.

“Chinese mobile carriers hope to decrease the risks of being a ‘dumb pipe’ and to relieve the pressure from Internet companies’ challenges,” Yan said.

Lingxi, the Chinese version of Apple Inc’s Siri service, will be installed on the new China Mobile smartphones. A year ago, China Mobile struck a $214 million deal to acquire a 15 percent stake in Anhui USTC iFlytek Co Ltd, a Chinese company that develops software and apps related to voice input services.

“Lingxi is a highlight of China Mobile smartphones,” said Li Lin, a marketing manager with iFlytek. Compared with Siri, Lingxi is more localized and has partnered with third-party service providers such as Dianping.com and douban.com to offer helpful daily living information for customers, Li said.

“You can ask Lingxi to make a phone call, send a text message or find a nearby restaurant,” Li explained.

The other benefit for China Mobile in its launch of own-brand smartphones is that it helps the carrier to expand and strengthen coverage in county-level markets.

“In tier five, tier six cities, which most mobile phone companies fail to reach, China Mobile can successfully sell smartphones through its powerful distribution channels,” Yan from IDC said. Those areas are usually remote from bustling cities and have less intense market competition, he said.

Kevin Wang, an analyst with the research firm IHS iSuppli, said China Mobile’s move will help reinforce its branding, but he said that he doubted the smartphone business will be a major revenue driver for the company.

“Foreign telecom operators such as AT&T and Vodafone have offered own-brand products for many years, but the own-brand smartphone proportion they sell is still small,” Wang said.

Filed under TMT Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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